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How Your Company’s Social Purpose Can Also Drive Profit

October 27, 2023
in Business
How Your Company’s Social Purpose Can Also Drive Profit
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The case for adopting an advocacy-based business model.

October 27, 2023

Jeffrey Coolidge/Getty Images

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Is it possible to implement corporate purpose in such a way that it achieves multi-stakeholder impact and high financial growth? To answer this question, the authors studied 12 companies that were employing various industry-specific strategies and found that those that successfully achieved the dual goals of purpose and profit did so by adopting what they call an “advocacy-based business model.” That model, they write, is underpinned by four key elements, and in this article they discuss those elements in turn, in each case providing real-world company examples that illustrate how an advocacy-based business model can support both purpose and profits.

Purpose-driven strategies focus on relationships with multiple stakeholders and seek to solve higher-order problems for society. To be successful, these strategies also have to achieve top- and bottom-line growth. The question is: How can companies achieve both of these goals?

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Thomas W. Malnight is an emeritus professor of strategy and general management at IMD, in Lausanne, Switzerland.

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Ivy Buche is an associate director of the Business Transformation Initiative at IMD, in Lausanne, Switzerland.

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Take your career to the next level by learning business and finance basics, and developing an enterprise mindset.

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